Issuing an analysis of English Housing Survey data, the party highlighted that £2.3bn in Housing Benefit, or around 1% of the total bill, is being paid to landlords letting out poor quality accommodation.
The issue is most acute in London where more than £850m a year is going to landlords renting out non-decent homes, and the South East, where the figure is £350m.
Homes classed as “non-decent” are those containing a serious hazard or in a poor state of repair. Nationally, almost a third (29%) of private rented homes are classed as non-decent.
John Healey, Labour’s shadow secretary of state for housing, said: “With one in four families with children now renting privately, the scandal of sub-standard rented homes can’t go on any longer, not least because too often the taxpayer pays for these properties through housing benefit.
“Ministers must use the opportunity of the promised white paper on housing to get to grips with the problem.”
Healey said the upcoming housing white paper gave ministers an opportunity to empower councils to deal with rogue landlords and for higher standards to be applied to the private rented sector.
Powers for councils might include tougher fines and licensing powers, and funds to enable the compulsory purchase of run-down private rented properties, he said.
Shadow communities minister Jim McMahon added: “If we accept that we are facing difficult times then it cannot be right for ministers to sit on their hands while public money is spent on sub-standard and often dangerous housing.
“The government must stop blocking councils from dealing with the worst landlords.”
